Technology
Monday, March 11th, 2024 3:31 pm EDT
Key Points
- Reddit aims to raise up to $748 million in its upcoming IPO, targeting a valuation of approximately $6.5 billion.
- The company plans to sell about 22 million shares at a price range of $31 to $34 per share, with approximately 1.76 million shares set aside for certain users and moderators who registered before January 1 to participate in the IPO.
- Reddit’s IPO, filed in February, is closely watched as the first major tech stock launch of the year and the first social media IPO since 2019. Despite recording a net loss of $90.8 million in 2023, Reddit reported a 20% increase in annual sales, reaching $804 million, and attracted notable shareholders like Tencent, Condé Nast’s parent company, and former board member Sam Altman.
Reddit is preparing for its initial public offering (IPO) with plans to raise up to $748 million and aiming for a valuation of around $6.5 billion. The social media platform intends to sell approximately 22 million shares at a price range of $31 to $34 per share, as detailed in a corporate filing released recently. Notably, Reddit has reserved about 1.76 million shares for certain users and moderators, dubbed Redditors, who registered their accounts before January 1 and wish to participate in the IPO. These users will be able to purchase and sell their shares without being subjected to a lock-up period typically imposed on investors post-IPO. However, Reddit cautioned that this participation from Redditors might result in increased stock market volatility. The company’s IPO follows the trend of other firms like Doximity, Rivian, and Airbnb, which allowed community members to participate in their IPOs via directed share programs. Reddit, which plans to trade on the New York Stock Exchange under the ticker symbol “RDDT,” is the first major tech stock launch of the year and the first social media IPO since Pinterest in 2019, attracting significant attention from investors. In 2021, Reddit confidentially filed its IPO prospectus with the Securities and Exchange Commission after raising $1.3 billion in funding, valuing the company at $10 billion. Despite recording a net loss of $90.8 million in 2023, narrower than the previous year’s $158.6 million loss, Reddit reported a 20% year-over-year increase in annual sales, reaching $804 million in 2023. Notable shareholders in Reddit include Tencent, Advance Magazine Publishers (parent company of Condé Nast), and former Reddit board member Sam Altman, CEO of OpenAI.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/03/11/reddit-to-raise-nearly-750-million-in-upcoming-ipo.html
